Report
\nTitle: Calculation of beta of Power Grid Corporation of India
\nAuthor: Philippa Rudolf Dmello (MBA Finance)
\nIntroduction: Power Grid is mainly engaged in the business of transmission of the power through its EHVAC\/HVDC transmission network. The company has diversified into telecom business but leveraging its Pan India transmission network through stringing of optical ground wire. Power Grid Corporation of India Limited is a central sector undertaking under the ownership of ministry of power.
\nObjective: Relationship of Power Grid Corporation of India with Nifty 50<\/p>\n
Literature Review:
\n1)\tTesting the equality of nifty 50 stocks volatility risk using correlated F-ratio:
\nThis article introduces a modified version of rescaling the scale and shape. The marginal rate univariate chi-square distribution with different degrees of freedom.
\nThe distribution of correlated F-ratio is derived and the percentage points are computed at 5% and 1% level. Therefore, in order to test the equality of variance, the returns pf Nifty 50 stocks are considered during pre and post periods in India (jayakumar & et al, 2022)<\/p>\n
2)\tThe impact of recession on liquidity and activity ratios of top power transmission company: case of power grid corporation of India Ltd:
\nThey discuss the liquidity ratios current ratio and quick ratio. Activity ratios, such as debtor turnover and inventory turnover ratios are also calculated for the POWERFRIDS\u2019S efficiency. They also identify whether there is is any subsequent recession. (Gupta & et al, 2022)<\/p>\n
Data Collection: Data was collected from NSE India site from 1st April 2022 to 31st march 2023. The data was manipulated from Friday closing prices. Weekly return of Nifty 50nwas termed as \u201cX\u201d. Weekly return of Power Grid Corporation of India was termed as \u201cY\u201d<\/p>\n
Data Analysis: Equation Power Grid Corporation of India Returns (y) = (0.1401+0.3026) Nifty returns (x) (1.1962)
\nN=50, R2=0.0289, F=1.431, Beta=0.302.
\nThe above equation shows the relationship between X & Y. (+) sign means there is a direct relationship which implies that if X rises Y also rises & vice versa. In this equation b=0.302, that is if X rises by 1 unit, demand (Y) will rise by 0.302. Hence b is statistically significant at 5% significance level.
\nR2=0.0289 which means 2.89% of Y is explained by X, similarly F=1.431 which is also greater than table value. Hence overall model is statistically significant at 5% significance level.<\/p>\n
Conclusion: Since it can be seen that the vale of b (beta) is less than 1 which implies that Power Grid Corporation of India is good to stable for long term investment <\/p>\n
References:
\nG.S. David Sam Jayakumar & W. Samuel & A. Sulthan, 2022. “Testing the equality of Nifty 50 stocks’ volatility risk using correlated F-ratio,” International Journal of Financial Markets and Derivatives, Inderscience Enterprises Ltd, vol. 8(4)
\nSurbhi Gupta & Anjali Naithani & Varsha Gautam, 2022. “The impact of the recession on the liquidity and activity ratios of top power transmission company: case of power grid corporation of India Ltd,” International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 13(3)<\/p>\n","protected":false},"excerpt":{"rendered":"
Report Title: Calculation of beta of Power Grid Corporation of India Author: Philippa Rudolf Dmello (MBA Finance) Introduction: Power Grid is mainly engaged in the business of transmission of the power through its EHVAC\/HVDC transmission network. The company has diversified into telecom business but leveraging its Pan India transmission network through stringing of optical ground… Continue reading Calculation of beta of Power Grid Corporation of India<\/span><\/a><\/p>\n","protected":false},"author":111996,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-17461","post","type-post","status-publish","format-standard","hentry","category-management","entry"],"_links":{"self":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/17461","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/users\/111996"}],"replies":[{"embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=17461"}],"version-history":[{"count":2,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/17461\/revisions"}],"predecessor-version":[{"id":17559,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=\/wp\/v2\/posts\/17461\/revisions\/17559"}],"wp:attachment":[{"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=17461"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=17461"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.sachdevajk.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=17461"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}